Toronto Detached Real Estate Prices Drop Up To $200,000

Toronto’s detached real estate is having another rough month. Numbers from the Toronto Real Estate Board (TREB) show that buyer indecision provided substantial downward pressure to the detached segment in July. Generally speaking, detached units across TREB saw lower prices, less sales, and more inventory.

Prices Declined Up To $205,000 From Last Month

Detached prices remain in positive territory, but are showing pretty large drops. The benchmark price, the price of a typical detached home, fell to $963,900 across TREB, a 6.16% decline from the month before. Before you say crash, this price is still 14.93% higher than the same time last year. In the 416, the benchmark price for a detached fell to $1,146,100, a 4.9% decline from the month before. This is up 13.12% from the same time last year. Prices remain positive across TREB, but price gains are tapering quickly.

Toronto Average Detached Prices

Month

TREB

416

905

Oct 2015

823,177

1,071,394

734,745

Nov 2015

829,241

1,018,621

762,326

Dec 2015

825,470

1,039,638

747,229

Jan 2016

848,999

1,061,789

783,565

Feb 2016

909,761

1,211,459

816,705

Mar 2016

910,375

1,174,358

837,217

Apr 2016

968,437

1,257,958

881,413

May 2016

986,691

1,285,693

891,870

Jun 2016

979,445

1,259,486

892,747

Jul 2016

952,983

1,202,753

888,565

Aug 2016

964,002

1,206,637

905,610

Sep 2016

1,013,788

1,294,482

928,414

Oct 2016

1,034,077

1,303,339

948,191

Nov 2016

1,058,273

1,345,962

957,517

Dec 2016

1,016,145

1,286,605

934,055

Jan 2017

1,068,670

1,336,640

999,102

Feb 2017

1,205,815

1,573,622

1,106,201

Mar 2017

1,214,422

1,561,780

1,124,088

Apr 2017

1,205,262

1,578,542

1,098,827

May 2017

1,141,041

1,503,868

1,025,893

Jun 2017

1,055,863

1,386,524

948,099

Jul 2017

1,000,336

1,304,288

910,348

Source: TREB.

Breaking down the 416, every neighbourhood saw a decline from the month before – but some stand out. The Rexdale-Kipling neighbourhood (TREB W10) saw prices drop the least, with the price of a detached home now $748,500, a decline of $12,600 from the month before. One of the city’s most affluent neighbourhoods, Bayview Village/Hillcrest Village (TREB C15), saw the greatest declines. The benchmark price for a detached in that neighbourhood fell to $1,532,100, a $205,200 decline from the month before.

Detached Sales Are Down 47.4%

Sales showed large declines, posting the worst number for July in at least 5 years. TREB saw 2,434 sales, a 47.4% decline from the same time last year. The 905 logged 1,878 of those sales, a 48.9% decline. The 416 saw 556 sales, a 41.7% decline. Sales tend to taper as prices get higher, but this is a really large drop. To contrast, July 2016 also saw a decline from the previous year, but it was only 1.5%.

Toronto Detached New Listings Vs. Sales

Month

Sales

New Listings

Oct 2015

4,100

6,299

Nov 2015

3,451

4,153

Dec 2015

2,134

1,980

Jan 2016

2,109

3,822

Feb 2016

3,627

5,165

Mar 2016

4,954

7,029

Apr 2016

6,062

7,805

May 2016

6,500

8,554

Jun 2016

6,307

8,432

Jul 2016

4,653

6,347

Aug 2016

4,449

5,803

Sep 2016

4,708

7,659

Oct 2016

4,499

6,767

Nov 2016

3,890

5,109

Dec 2016

2,259

1,736

Jan 2017

2,261

3,244

Feb 2017

3,721

4,825

Mar 2017

5,887

9,012

Apr 2017

5,715

11,863

May 2017

4,757

14,036

Jun 2017

3,450

10,263

Jul 2017

2,434

6,989

Source: TREB.

Detached Inventory Is Building

Inventory is soaring across the TREB, especially in the suburbs. The GTA saw 6,989 detached listings, a 10% increase from the same time last year. The 416 saw 1,282 new listings, a 27% increase from the same time last year. In terms of total inventory, the month ended with 10,497 active detached listings, a 120% increase from the same time last year. It’s too soon to call it a trend, but active detached listings have been significantly higher over the past three months than they have been over the past couple of years.

The city has been hit with a number of changes that impact the market, including the Ontario Fair Housing Plan, higher interest rates, and increased difficulty in obtaining mortgages. Historically, higher interest rates only impact the Canadian market for less than a year, but it’s tough to tell what the combination of factors will do. This really is a wait and see market, the best case scenario for homeowners being a repeat of Vancouver.